CMG

Chipotle Mexican Grill Stock in Brief

It's been a great afternoon session for Chipotle Mexican Grill investors, who saw their shares rise 2.3% to a price of $54.24 per share. At these higher prices, is the company still fairly valued? If you are thinking about investing, make sure to check the company's fundamentals before making a decision.

Its Shares Are Discounted but Has an Elevated P/B Ratio:

Chipotle Mexican Grill, Inc., together with its subsidiaries, owns and operates Chipotle Mexican Grill restaurants. The company belongs to the Consumer Discretionary sector, which has an average price to earnings (P/E) ratio of 22.15 and an average price to book (P/B) ratio of 3.11. In contrast, Chipotle Mexican Grill has a trailing 12 month P/E ratio of 53.2 and a P/B ratio of 20.04.

Chipotle Mexican Grill's PEG ratio is 2.3, which shows that the stock is probably overvalued in terms of its estimated growth. For reference, a PEG ratio near or below 1 is a potential signal that a company is undervalued.

Strong Revenue Growth and a Decent Current Ratio:

2018 2019 2020 2021 2022 2023
Revenue (M) $4,865 $5,586 $5,985 $7,547 $8,635 $9,872
Operating Margins 5% 8% 5% 11% 13% 16%
Net Margins 4% 6% 6% 9% 10% 12%
Net Income (M) $177 $350 $356 $653 $899 $1,229
Net Interest Expense (M) $10 $14 $4 $8 $21 $63
Depreciation & Amort. (M) $202 $213 $239 $255 $287 $319
Diluted Shares (M) 28 28 28 29 28 28
Earnings Per Share $6.31 $12.38 $12.52 $22.9 $32.04 $44.34
EPS Growth n/a 96.2% 1.13% 82.91% 39.91% 38.39%
Avg. Price $413.58 $722.89 $1060.86 $1615.89 $1445.2 $54.2
P/E Ratio 65.13 57.28 83.27 69.62 44.77 1.22
Free Cash Flow (M) $334 $388 $290 $840 $844 $1,223
CAPEX (M) $287 $334 $373 $442 $479 $561
Current Ratio 1.81 1.61 1.73 1.58 1.28 1.57

Chipotle Mexican Grill benefits from rapidly growing revenues and increasing reinvestment in the business, strong operating margins with a positive growth rate, and exceptional EPS growth. The company's financial statements show generally positive cash flows and a decent current ratio of 1.57.

The above analysis is intended for educational purposes only and was performed on the basis of publicly available data. It is not to be construed as a recommendation to buy or sell any security. Any buy, sell, or other recommendations mentioned in the article are direct quotations of consensus recommendations from the analysts covering the stock, and do not represent the opinions of Market Inference or its writers. Past performance, accounting data, and inferences about market position and corporate valuation are not reliable indicators of future price movements. Market Inference does not provide financial advice. Investors should conduct their own review and analysis of any company of interest before making an investment decision.

IN FOCUS